Goal hierarchies as antecedents of market structure

Abstract

Current models of market structure are descriptive in nature and lack theoretical grounding in consumer behavior. Such grounding is especially needed in the specification of marketing strategies. A self-regulatory model of consumer consideration-set formation will be employed as a basis of market structure in this article. The authors propose and show that consumers regulate their behavior according to goals at different levels of their goal hierarchies, which in turn determine brand consideration. Differences in the salience of goals at different hierarchical levels lead to differences in the composition of consideration sets. It is precisely these individual differences in brand consideration that determine the structure of a market. The analysis of consumers' goal hierarchies therefore answers, in part, the question of why a market has a certain structure. Hypotheses on brand consideration and the role of system- and principle-level goals are tested on a sample of 1,018 consumers of automobiles. © 2006 Wiley Periodicals, Inc.